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Tags: dividend stocks | retirement income | walgreens boots alliance | enbridge | first of long island
OPINION

Bob Ciura: 3 High-Yield Stocks to Buy Now

Bob Ciura: 3 High-Yield Stocks to Buy Now
(AP)

Bob Ciura By Tuesday, 04 July 2023 07:31 AM EDT Current | Bio | Archive

High-dividend stocks are appealing for income investors, as the S&P 500 Index yields just 1.7% on average right now. But investors can still find high yields in the stock market without accepting excessive risks.

By contrast, the 3 high-dividend stocks in this article all have current yields in excess of 5%, and are attractively valued today. These qualities make them attractive for income investors right now.

Walgreens Boots Alliance (WBA)

Walgreens Boots Alliance is the largest retail pharmacy in both the United States and Europe. Through its flagship Walgreens business and other business ventures, the company has a presence in more than 9 countries, and has more than 13,000 stores in the U.S., Europe, and Latin America.

On June 27th, 2023, Walgreens reported results for the third quarter of fiscal 2023. Sales grew 9% but earnings-per-share rose only 3% over last year’s quarter, from $0.97 to $1.00, mostly due to high COVID-19 vaccinations and tests in last year’s period.

However, the company remains highly profitable with more than enough cushion to pay its hefty dividend.

The stock is now attractively valued at just ~7 times this year’s earnings-per-share. And, WBA stock has a very high dividend yield of 6.7%. Walgreens has increased its dividend for over 40 consecutive years, placing it on the list of Dividend Aristocrats.

Enbridge (ENB)

Enbridge is an oil & gas company that operates the following segments: Liquids Pipelines, Gas Distributions, Energy Services, Gas Transmission & Midstream, and Green Power & Transmission. Enbridge bought Spectra Energy for $28 billion in 2016 and has become one of the largest midstream companies in North America. Enbridge was founded in 1949 and is headquartered in Calgary, Canada.

Enbridge reported its first quarter earnings results on May 5. The company generated lower revenues during the quarter, but since commodity prices are mostly a pass-through cost for the company, lower revenues do not necessarily translate into lower profits. During the quarter, Enbridge still managed to grow its adjusted EBITDA by 10% year over year, to CAD$4.5 billion, up from CAD$4.1 billion during the previous year’s quarter. This was possible thanks to expenses dropping faster than revenues.

Enbridge was able to generate distributable cash flows of CAD$3.2 billion, which equates to US$2.4 billion, or US$1.19 on a per-share basis, which was up by a solid 3% year over year in CAD. Enbridge is forecasting distributable cash flows in a range of CAD$5.25-5.65 per share for the current year. Using current exchange rates, this equates to USD$4.09 at the midpoint of the guidance range, which would be a new record for the company.

ENB has a projected dividend payout ratio of approximately 65% for 2023, signifying a safe dividend. The stock has a 7.0% dividend yield.

First of Long Island (FLIC)

The First of Long Island Corporation is the holding company for The First National Bank of Long Island, a small-sized bank that provides a range of financial services to consumers and small to medium-sized businesses. Its offerings include business loans, consumer loans, mortgages, savings accounts, etc. FLIC operates around 50 branches in two Long Island counties and several NYC burrows, including Queens, Brooklyn, and Manhattan.

FLIC reported its most recent quarterly results on May 2. The company reported revenues of $23 million for the first quarter, which was 28% less than the revenues that the company generated during the previous year’s period. The bank’s net interest margin declined year over year, from 2.90% during the previous year’s quarter to 2.34%.

The First of Long Island has increased its dividend annually for more than a decade in a row, adjusted for stock splits. This was possible thanks to regular earnings growth, while the company has also increased its payout ratio over the years. At a payout ratio of around 67%, the dividend still looks quite safe. Shares currently yield 7.0%.

_______________
Bob Ciura has worked at Sure Dividend since October 2016. He oversees all content for Sure Dividend and its partner sites. Bob received a Bachelor’s degree in Finance from DePaul University, and an MBA with a concentration in Investments from the University of Notre Dame.

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BobCiura
High-dividend stocks are appealing for income investors, as the S&P 500 Index yields just 1.7% on average right now. But investors can still find high yields in the stock market without accepting excessive risks.
dividend stocks, retirement income, walgreens boots alliance, enbridge, first of long island
684
2023-31-04
Tuesday, 04 July 2023 07:31 AM
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